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*Walter Bloomberg
*Walter Bloomberg@DeItaone·
RYANAIR CEO EXPECTS OIL PRICES TO FALL SOON, ACCORDING TO WIRTSCHAFTSWOCHE INTERVIEW
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calvin nguyen
calvin nguyen@CalNgT·
Why other ailrlines don’t hedge oil prices like $RYAAY: They use financial contracts with banks or oil companies. These contracts let them "lock in" a price for a big chunk of their future fuel needs. - They usually hedge 70-85% of their expected fuel (not 100%, so they can still benefit if prices fall). - They mostly use swaps or forwards — basically agreements to pay a fixed price later, no matter what the market does. - They time it smartly: They hedge more when prices look low, and sometimes pause when prices are very high (like right now in April 2026, betting on a possible drop). Think of it like this everyday example: You know you'll need 100 liters of petrol for your car every month for the next year. Petrol is €2 per liter today, but it might jump to €3 or drop to €1.50. Instead of waiting, you sign a deal with a supplier: "I'll pay you €2.10 per liter for all 100 liters each month, no matter what happens." - If price goes to €3 → You save €0.90 per liter (win!). - If price drops to €1.50 → You still pay €2.10, so you "lose" a bit compared to others (but your costs are predictable). Ryanair does the same, but for millions of tons of jet fuel, often tied to oil prices (like Brent crude) because jet fuel moves closely with oil. #OOTT $USO $AAL $UAL $DAL $JBU $ULCC $SPY $QQQ
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